The FBI has launched a criminal investigation into how the Internal Revenue Service unduly scrutinized and excessively delayed applications for nonprofit status from tea party groups, including at least two based in Georgia.
An inspector general’s report leaked Tuesday provided new details to the unfolding scandal, finding that the IRS used “inappropriate criteria” to flag groups for extra scrutiny for having such words as “tea party” and “patriot” in their names for 18 months before it was changed in May 2012, and that some applications were delayed more than three years, crossing two election cycles.
Leaders from the Woodstock-based Tea Party Patriots, a national umbrella group, and the Cobb County-based Georgia Tea Party told The Atlanta Journal-Constitution that they faced invasive questioning about the groups’ members, funding and political ties.
The groups were newly formed and applying for the 501(c)4 designation from the IRS as a tax-exempt “social welfare group.” By law such groups are not allowed to engage in political activity as their primary focus. The tea party groups see such questioning as political harassment for opposing the Obama administration, and key members of Congress from both parties have vowed a fuller inquiry.
J.D. Van Brink of Cobb County, the chairman of the Georgia Tea Party, said that in response to its request for 501(c)4 status his group received an IRS questionnaire that required “a thousand printed pages” to respond. Postage to send it back to the IRS cost $250, he said.
“Think of all the wasted time and effort that goes into the corporate income tax,” Van Brink said. “It’s corruption, is what it is, and it’s an abuse of power.”
Van Brink said tax-exempt status was eventually granted to the Georgia Tea Party. “What we were suspicious of is that they were going to follow up in the weeks before the primary, to keep us occupied,” he said. “But that didn’t happen.”
Debbie Dooley, a national coordinator for the Tea Party Patriots, said the IRS asked for information about her group’s donors, political ties and for such detailed information as screen shots of supporters’ comments on its Facebook page.
The group resisted handing over all that information, and Dooley said the ongoing legal dispute with the IRS has cost upward of $100,000.
“This is tyranny at its best,” Dooley said. “And groups on the left need to understand if the IRS gets away with this, it’s a matter of time before a Republican administration comes after them.”
The IRS first admitted targeting tea party groups Friday and apologized. That’s when the FBI and Justice Department started coordinating on a criminal probe, Attorney General Eric Holder told reporters Tuesday.
The Treasury Department inspector general started investigating claims of harassment from tea party groups in 2012.
Joseph Grant, the IRS’ acting commissioner for tax-exempt and government entities, responded in the report that his office was doing the best it could with a surge in nonprofit applicants, but he acknowledged mistakes in the criteria used to flag groups and the information the IRS sought from them.
“We believe the front line career employees that made the decisions acted out of a desire for efficiency and not out of any political or partisan viewpoint,” Grant wrote.
The IRS was made more politically independent after the Watergate scandal, during which President Richard Nixon used it to punish political enemies. It only has two political appointees, one of whom is a director who serves a set five-year term, avoiding the rhythm of quadrennial elections. Lois Lerner, the IRS’ head of tax-exempt organizations who apologized for the targeting, is a career employee who cannot be fired without civil service proceedings.
White House press secretary Jay Carney said Tuesday that the White House counsel’s office was informed “broadly” about the IRS probe by the inspector general a couple of weeks ago, and any consequences would have to wait until the report is released in full.
Many of the IRS letters requesting extensive information from the tea party groups went out in 2012 during President Barack Obama’s re-election campaign, prompting tea party groups and their allies to cry foul.
U.S. Rep. Tom Graves of Ranger said he heard concerns from constituents and media reports last year before quizzing then-IRS Commissioner Douglas Shulman at a congressional hearing. In May 2012 Graves asked whether the IRS was targeting certain 501(c)4 groups for political reasons, and Shulman replied, “When we decide to do an examination, we pride ourselves on being a nonpolitical, nonpartisan agency.”
Tuesday, Graves said, “The question today is now did he lie to me and our committee — and to committees afterward — and who in fact had given this order?”
Shulman stepped down in November. Steven Miller is the acting commissioner.
Many Democrats in Congress and outside groups have urged the IRS to take a tougher line on political activity by 501(c)4s. Nonpartisan Democracy 21 asked the IRS to better define what constitutes impermissible amounts of political activity by social welfare groups and crack down on big-spending groups closely aligned with campaigns, such as the pro-Republican Crossroads GPS and Priorities USA, operated by former Obama staffers.
“In our view, they got this backward,” Democracy 21 President Fred Wertheimer said of the IRS. “They were focusing in on groups they never should have focused in on, and they have failed to enforce the laws against groups that we believe are blatantly misusing the tax laws to hide donors financing their campaign expenditures.”
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